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India cash crunch boosts mobile payments

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India’s surprise move to get rid of big banknotes may have sparked a nationwide cash crunch, but it has proved a boost for mobile payment firms.

The country’s largest digital wallet firm, Paytm, logged a record of over seven million transactions on Saturday.

The loss-making firm is valued at about $5bn (£4bn) and backed by Chinese e-commerce giant Alibaba.

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Paytm claims to have 150 million users while its nearest rival MobiKwik has 35 million.

Both companies have seen a surge in new users signing up.

This comes after the move by Indian Prime Minister Narendra Modi earlier this month to abolish 500 and 1,000 rupee notes, which essentially wiped out 86 percent of the country’s cash.

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Mobile payments firms have also been marketing their services aggressively as people struggle to deal with a sudden cash crunch.

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